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National Arbitration Forum

DECISION

Russell & Miller, Inc. v. Dismar Corporation

Claim Number: FA0410000353039

PARTIES

Complainant is Russell & Miller, Inc. (“Complainant”), represented by Stephen J. Meyers, of Drinker Biddle & Reath LLP, One Logan Square, 18th and Cherry Street, Philadelphia, PA 19103-6996.  Respondent is Dismar Corporation (“Respondent”), represented by Andrew Gowa, of Gowa Lincoln, PC, 1525 Locust Street, Suite 1000, Philadelphia, PA 19102-3711.

REGISTRAR AND DISPUTED DOMAIN NAME 

The domain name at issue is <salesigns.com>, registered with Network Solutions, Inc.

PANEL

Each of the undersigned certifies that he has acted independently and impartially and to the best of his or her knowledge has no known conflict in serving as Panelist in this proceeding.

Hon. Sir Ian Barker, Q.C., Mr. G. Gervaise Davis III and Mr. M. Kelly Tillery

PROCEDURAL HISTORY

Complainant submitted a Complaint to the National Arbitration Forum electronically on October 27, 2004; the National Arbitration Forum received a hard copy of the Complaint on October 27, 2004.

On October 29, 2004, Network Solutions, Inc. confirmed by e-mail to the National Arbitration Forum that the domain name <salesigns.com> is registered with Network Solutions, Inc. and that Respondent is the current registrant of the name.  Network Solutions, Inc. has verified that Respondent is bound by the Network Solutions, Inc. registration agreement and has thereby agreed to resolve domain-name disputes brought by third parties in accordance with ICANN’s Uniform Domain Name Dispute Resolution Policy (the “Policy”).

On November 3, 2004, a Notification of Complaint and Commencement of Administrative Proceeding (the “Commencement Notification”), setting a deadline of November 23, 2004 by which Respondent could file a Response to the Complaint, was transmitted to Respondent via e-mail, post and fax, to all entities and persons listed on Respondent’s registration as technical, administrative and billing contacts, and to postmaster@salesigns.com by e-mail.

A timely Response was received and determined to be complete on November 23, 2004.

Additional Submissions were received from both parties.  Complainant’s Additional Submission was filed late.  Without opposition from Respondent, the Panel agreed to receive this submission.

On December 7, 2004 pursuant to Complainant’s request to have the dispute decided by a three-member Panel, the National Arbitration Forum appointed Hon Sir Ian Barker, QC, Mr. G. Gervaise Davis III, and Mr. M. Kelly Tillery as Panelists.

RELIEF SOUGHT

Complainant requests that the domain name be transferred from Respondent to Complainant.

PARTIES’ CONTENTIONS

A.            Complainant

Complainant, Russel & Miller, Inc., supplies a variety of business products and services, including printed materials for businesses.  It is the owner, through assignment, of the trademark SALE!SIGNS, United States Trademark Registration No. 2,342,421, for “paper tags for use in selling, advertising, and promoting goods and services; non-luminous, non-mechanical plastic signs for use in selling, advertising, and promoting goods and services.”  Complainant and its predecessors-in-interest have used the trademark SALE!SIGNS since at least as early as 1988. 

Respondent is a competitor of Complainant, selling sign kits and plastic display signs for use in selling, advertising, and promoting goods and services.  Respondent registered the disputed domain name <salesigns.com> on May 18, 1996.  An active website was posted on October 13, 1999.

Complainant’s United States Trademark Registration establishes its rights to that mark with regard to Policy ¶ 4(a)(i).

The disputed domain name is identical or confusingly similar to Complainant’s mark.  The only difference is that the disputed domain name does not include the exclamation point “!”, which cannot be part of a domain name.  The absence of a punctuation mark does not defeat the confusing similarity. See A&F Trademark Inc. and another v. Rahschulte D2001-0901 (WIPO Sept. 17, 2001) (regarding the <abercrombiefitch.com> domain name).

Respondent has no rights or legitimate interests in the domain name.

Respondent’s registration and use of the SALE!SIGNS mark as a domain name is an attempt to trade on the goodwill associated with Complainant’s well-known mark.  Respondent has no connection or affiliation with Complainant and has not received a license or consent, express or implied, to use its mark in a domain name or in any other manner.  Respondent’s only use of the term “SALESIGNS” is as a domain name for a commercial website featuring Respondent’s goods and services. 

Bad faith registration occurred, based on the following:  (i) the disputed domain name contains for all essential purposes Complainant’s trademark, (ii) such trademark has been in use for a substantial time prior to the use of the disputed domain name by Respondent and is a well-known mark, and (iii) Respondent can allege no good faith basis for its use of the Domain Name.

Respondent is using the disputed domain name in bad faith.  Respondent is not using the disputed domain name in a legitimate non-commercial manner.  Instead, it is using, and has used, the disputed domain name to drive Internet traffic to its own commercial website that, like Complainant’s, offers signage products.  Such use is likely to deceive or mislead the public into believing that Respondent’s site is associated or affiliated with, or sponsored or endorsed by Complainant. 

The disputed domain name is identical and/or confusingly similar to Complainant’s mark and an Internet user will likely believe that there is an affiliation between Respondent and Complainant.  Registration of the disputed domain name, which is confusingly similar to R & M’s mark, is evidence of bad faith pursuant to Policy ¶ 4(b)(iv). 

Complainant’s trademark application was filed on July 6, 1998.  According to the Way Back Machine, at <www.archive.org>, the first time a web page was ever posted at the SALESIGNS.COM domain name was October 13, 1999.  Thus, Respondent, through the USPTO website could easily have determined whether any third party including Complainant’s predecessors-in-interest had rights in the mark prior to launching its website

B. Respondent

Respondent traces its roots to a small shop in Philadelphia in 1934, which printed and sold price tags and small signs primarily to retail shoe stores.  In 1946 the company incorporated as Display marketers, Inc.  By this point, Display marketers was manufacturing and selling larger sale signs, as well as sale tags, to its customers who owned retail stores across the east coast of the United States. 

In the 1950s, Display marketers Inc. began to market its sale signs and related products in direct mail catalogs throughout the United States, and had begun to trade under the name “Dismar.”  Early catalogues prominently exhibited Dismar’s sale signs, tags and other products to a national audience.  In 1978, it incorporated in New Jersey as Dismar Corporation.  

By its own admission, Complainant started doing business in the sale sign industry in 1988, more than 54 years after Respondent began its operations. 

On March 18, 1996, Respondent registered the disputed domain name, <salesigns.com>, a description of its major product for over 60 years of sale signs.  At the time, it had no idea that Complainant (or any predecessor) had any intention of applying for a trademark of the term “SALE!SIGNS,” if such a term could in fact be legally registered. 

Some time in 1996 or 1997, a man (believed to be a Mr. Lou Oates) claiming to be the owner of a brand in Illinois called Sale!Signs, a local sole proprietorship that was a small distributor of signs, telephoned Respondent.  He told Mr. Senker that the disputed domain name was similar to the “Sale!Signs” name that the caller had been using.  He asked whether Respondent would be interested in transferring that domain name to the caller.  Mr. Senker advised that the domain name was merely a generic description of the products that Respondent and other companies sold (“sale signs”); that Respondent had been in the business of making and selling sale signs for over 60 years, that Respondent sold far more sale signs each year than the caller did, and that Respondent had absolutely no intention of relinquishing its domain name.  From that call until this year, Respondent never heard from anyone associated with Sale!Signs (including Complainant) regarding the disputed domain name.

In April 1998, Respondent hired a professional website design and hosting company, The 28^th Street Internet Co., Inc. of New York City (“Website Company”), to design the website at the disputed domain name.  Evidence was introduced of payments by Respondent to the website company.

 

Complainant, alleges that Respondent’s website was not in existence until October 13, 1999.  Respondent’s own records and the sworn testimony of an executive of the Website Company, make it clear that the website was hosted and available on the Internet as early as May 8, 1998, prior to Complainant’s trademark application, and, that it was fully operational by July 1998, the very month Complainant filed its trademark application. 

Complainant failed to include in its submission to this Panel, the history of the trademark proceedings before the United States Patent and Trademark Office (“PTO”) relating to its trademark registration of “SALE!SIGNS”.  It is critical to examine the entire file of the PTO, and especially the representations made by Complainant in obtaining that registration. 

The first official action by the PTO on the SALE!SIGNS trademark application was the issuance of a non-final action, frequently called an “office action,” dated December 15, 1998, wherein the PTO refused registration of the SALE!SIGNS mark “because the proposed mark merely describes the goods,” citing Section 2(e)(1) of the Trademark Act. 

In response to the refusal, on June 18, 1999, Complainant filed a Response To Office Action on December 15, 1998 (“Trademark Response”) and a Declaration dated June 15, 1999 of John Trimberger (“Declaration”), Complainant’s then President.  In the Trademark Response, Complainant argued:

When considered as a whole, SALE!SIGNS does not merely describe the wide variety of paper tags and plastic signs applicant sells for use by its customers…  [This] is also confirmed by the fact that none of the companies producing paper tags and plastic signs use SALE!SIGNS or any similar mark.  The lack of any use by competitors of the mark supports applicant’s claim of exclusive rights to the mark.  (citations omitted) 

This representation was made to the PTO by Complainant at least three years after Complainant had actual and constructive notice that Respondent had registered the disputed domain name and more than one year after Respondent was offering its goods and services on the Internet through the website. 

The PTO relied on the Trademark Response and Declaration when it proceeded to register the trademark SALE!SIGNS on which Complainant relies in the matter now before the Panel.

Complainant never contacted Respondent to protest, or to instruct it to cease or desist using the words “sale signs” in connection with its business, domain name or website. 

In the first half of 2004, Mr. Senker received three telephone calls from Michael Wooten, Complainant’s President, asking him, with increasing firmness, to transfer the disputed domain name to Respondent.  Respondent declined on each occasion. 

What allowed SALE!SIGNS to be a registered trademark in the first instance was Complainant’s representation to PTO that no competitors had used that mark or anything similar—at a time when Respondent had already registered the disputed domain name and developed a website with that name—and that the “!” made the mark distinctive and fanciful as opposed to descriptive.  Complainant now argues that Respondent is using a similar mark (the very domain name it registered three years before the trademark application) and that the “!” must be disregarded now so that Complainant can try to prove to this Panel that there is no difference between “SALE!SIGNS” and the disputed domain name.

Respondent’s Response was accompanied by sworn affidavits from Mr. Senker and from the website designer which supported the allegations.

As to Complainant arguing that Respondent cannot have a legitimate interest in the domain name because it “does not have a legitimate interest,” were that circular reasoning supportable under the ICANN Policy, there would never be any ICANN dispute cases involving registered trademarks. By merely stating a legal conclusion, without supporting facts, Complainant fails to sustain its burden of proving the required criteria set forth in Policy ¶ 4(a)(ii).  On the contrary, it is clear from the Complaint that the trademark application was filed two years after the domain name registration, which in itself, provides Respondent with the requisite rights and legitimate interests in its domain name. 

As to bad faith, Respondent registered the domain name two years before Complainant even applied for a trademark.  At no time did it know that Complainant had any intention to apply for a trademark registration.  Respondent’s website had been posted and operational in the same month as Complainant applied for its trademark application, six months or more before the PTO initially refused its application, and two years before any registration was ever issued. 

           

Complainant argues that it need not prove bad faith at the time of the domain registration, if it can prove bad faith in the subsequent use of the domain name.

Complainant then argues that evidence of Respondent’s bad faith use (not registration) of the domain name is shown by the fact that it used the website after Complainant applied for the trademark, and therefore, by viewing the PTO website, Respondent was on constructive notice that Complainant had filed for a trademark registration for “SALE!SIGNS.”  However, constructive notice alone cannot be taken as evidence of bad faith.  See Sterling, Inc. v. Sterling Jewelers, Inc., D2002-0772 (WIPO Nov. 13, 2002).  And Complainant must show evidence of widespread use or the fame of the mark before Respondent’s registration and use of the domain name.  Expedia, Inc. v. European Travel Network, D2000-0137 (WIPO Apr. 18, 2000).

Based on the facts and evidence, Respondent requests that the Panel make a finding of reverse domain name hijacking.  While it is rare for a Panel to determine reverse domain name hijacking, the facts here are egregious.  In addition to the evidence that substantiates that the Complaint was brought in bad faith: (1) Complainant has owned the <sale-signs.com> domain name but has never posted, or even requested Respondent’s permission to post a <sale-signs.com> website (or even direct that URL to its long-held <www.valudisplay.com> site), evidencing that Complainant’s plan has always been to grab Respondent’s now successful domain name rather than develop its own website; (2) there was no bad faith when Respondent’s domain name was registered, thereby making the Complaint baseless on its face; (3) Complainant seems to be an “old pro” at using (albeit it unsuccessfully) an ICANN domain name dispute in bad faith to try to steal a generic and descriptive domain name that a small company developed into a successful website.  See Russell & Miller, Inc. v. S. Walter Packaging Corp., FA 98410 (Nat. Arb. Forum Oct. 9 2001) (involving the domain name <bagsandbows.com>); and (4) Complainant sat quietly for six years while Respondent developed and advertised its domain name and site at considerable expense, and then when the site was well-known and reaping results, Complainant tried to intimidate and threaten Respondent with Complainant’s size, financial clout and legal resources to give it the domain name. 

C. Additional Submissions

The additional submissions of both parties are couched somewhat emotively.  The following points can be distilled – additional to those in the principal pleadings.

Complainant

(a) Respondent is fully aware of Complainant’s rights since it collects Complainant’s promotional material.

(b) Complainant has a common law mark in Sale!Signs which was established by use since 1988 – long before the trademark registration.

(c) Complainant was under no obligation to disclose to the PTO Respondent’s use of the disputed domain name.

(d) Respondent’s claim that Complainant was on “constructive notice” of the disputed domain name is a novel and unwarranted proposition.

Respondent

(a) Respondent does not assert trademark rights in the disputed domain name that it has used successfully for 6 years without challenge.

(b) There is no evidence that the words “Sales Signs” are anything other than generic.

FINDINGS

After consideration of the documents and submissions, the Panel makes the following findings:

(a)            The disputed domain name was registered by Respondent on March 18, 1996.

(b)        Respondent started developing its website in early 1998 and had it publicly available on the Internet by May 8, 1998.  It paid for the creation of a professionally produced website. 

(c) A Mr. Lou Oates applied to the PTO for a trademark registration of the mark SALE!SIGNS on July 6, 1998.

(d) Some time in 1996 or 1997, a person claiming to trade as ‘Salesigns’ asked Respondent to transfer the disputed domain name.  Respondent refused to do so.  This person may have been Mr. Oates.

(e) The trademark was finally registered by the PTO on April 18, 2000, after a representative of Complainant had declared on June 15, 1999 that none of its competitors used the mark in connection with the sale of paper tags and plastic signs for selling, advertising and promoting goods and services.  The same declarant deposed that Complainant had purchased the mark from Mr. Oates on March 4, 1999.

(f) As at the date of registration of the disputed domain name, Respondent did not know of Complainant and its use of the mark SALE!SIGNS.  There is no evidence whether this Complainant knew of Mr. Oates telephone call to Ms. Secker.

(g) Although Complainant asserted widespread use of the mark from 1988 until the date of application for trademark registration, the evidence produced by it falls far short of what is needed to justify proof of a common law trademark.  For what is required.  See, e.g., Barnes v. Old Barnes Studios Ltd, D2001-0121 (WIPO Mar. 30, 2001); Luis Cobos v. West, North, D2004-0182 (WIPO June 21, 2004); BAAplc v. Larkin D2004-0555 (WIPO Nov. 11, 2004).  The proof is particularly deficient when it is asserted that the mark was well known when it was used by Mr. Oates before 1999.  One might have expected evidence from him.

(h) Respondent has been conducting a bona fide business selling sales and promotional tags and signs for many years.

DISCUSSION

Paragraph 15(a) of the Rules for Uniform Domain Name Dispute Resolution Policy (the “Rules”) instructs this Panel to “decide a complaint on the basis of the statements and documents submitted in accordance with the Policy, these Rules and any rules and principles of law that it deems applicable.”

Paragraph 4(a) of the Policy requires that Complainant must prove each of the following three elements to obtain an order that a domain name should be cancelled or transferred:

(1) the domain name registered by Respondent is identical or confusingly similar to a trademark or service mark in which Complainant has rights;

(2) Respondent has no rights or legitimate interests in respect of the domain name; and

(3) the domain name has been registered and is being used in bad faith.

Identical or Confusingly Similar: Policy ¶ 4(a)(i).

Complainant alleges rights in the SALE!SIGNS mark as the result of U.S. trademark registration number 2,342,421 (issued April 18, 2000).

Complainant claims to be the assignee of rights in the mark.  It states that its predecessors-in-interest first used the SALE!SIGNS mark in commerce in 1988. 

Complainant also argues that the SALE!SIGNS mark has acquired secondary meaning “through extensive promotion, sales and recognition among the public.”  Although it does not directly address at what point in time the mark acquired secondary meaning, it seems to imply that the secondary meaning was established prior to the disputed domain name registration on May 18, 1996. 

However, the evidence in support of that assertion falls far short of the proof necessary for a common law mark – especially one based on essentially descriptive words.  This is all the more so when any common law reputation for the mark must have been acquired when it was owned by Mr. Oates, yet there is no evidence from him. 

Complainant charges that the disputed domain name is confusingly similar to Complainant’s SALE!SIGNS mark because the domain name simply omits the exclamation point that is present in Complainant’s mark.  Because exclamation points are incapable of being reproduced in domain names, the omission of such characters in domain names does not significantly effect the determination of whether a domain name is identical or confusingly similar to another’s mark.  See Mrs. World Pageants, Inc. v. Crown Promotions, FA 94321 (Nat. Arb. Forum Apr. 24, 2000).

Complainant has rights in the registered mark as at the date of filing of the Complaint.  For the purposes of the first criterion under the Policy, it matters not that trademark registration took effect after the registration of the disputed domain name.  However, such a finding is not helpful to Complainant, since the lack of rights in a mark at the time of registration of the domain name is relevant under the last two criteria. 

The Panel cannot inquire into whether the trademark was improperly registered by the PTO either because of some alleged misconduct on the part of Complainant 

Accordingly, Complainant succeeds under the first criterion.

Rights and Legitimate Interests: Policy ¶ 4(a)(ii)

Because the disputed domain name is comprised of descriptive terms (albeit trademarked), Respondent has rights or legitimate interests in the domain name because it is not exclusively associated with Complainant’s business.  See Energy Source Inc. v. Your Energy Source, FA 96364 (Nat. Arb. Forum Feb. 19, 2001) (finding that Respondent has rights and legitimate interests in the domain name where “Respondent has persuasively shown that the domain name is comprised of generic and/or descriptive terms, and, in any event, is not exclusively associated with Complainant’s business”); see also Coming Attractions, Ltd. v. Comingattractions.com, FA 94341 (Nat. Arb. Forum May 11, 2000) (finding Respondent had the right to register the subject domain name, <comingattractions.com>, based upon the generic usage of the term "coming attractions"); see also FilmNet Inc. v. Onetz, FA 96196 (Nat. Arb. Forum Feb. 12, 2001) (finding that Complainant failed to establish that Respondent did not have rights or legitimate interests in the <filmnet.com> domain name, where the disputed domain name is wholly comprised of generic words, even though Complainant is the owner of the FILMNET mark).

Moreover, in the Panel’s opinion, Respondent is using the disputed domain name in connection with a bona fide offering of goods or services pursuant to Policy ¶ 4(c)(i).  As proof, Respondent has provided sworn evidence of its longstanding involvement in the “sale sign” market and its use of a descriptive domain name to further its competition in that market.  See Modern Props, Inc. v. Wallis, FA 152458 (Nat. Arb. Forum June 2, 2003) (finding that Respondents operation of a bona fide business of online prop rentals for over two years was evidence that Respondent had rights or legitimate interests in the disputed domain name); see also Scholastic Inc. v. Master Games Int’l, Inc., D2001-1208 (WIPO Jan. 3, 2002) (finding that Respondent’s use of the disputed domain name for a website regarding chess tournaments, particularly because the domain name appropriately described both the target users of Respondent’s services and the nature of Respondent’s services, was a bona fide use of the domain name).

The domain name is therefore being used “to describe the content of the site,” as evidence that Respondent is making a bona fide offering of goods or services with the disputed domain name.  Accordingly in the Panel’s view, Respondent has satisfied Policy ¶  4(c)(i).

Registration and Use in Bad Faith

In these circumstances, it is not necessary for the Panel to fully explore the bad faith issue.  The Panel considers a finding of bad faith registration against Respondent to be impossible.  In 1996, when the domain name was registered, Complainant had not even applied for US trademark.  Although it might have had a large business selling “sale signs” the evidence of its having a common law trademark just does not exist.  Nor can there be bad faith in the use by Respondent of a domain name that reflects the business it has carried on legitimately for many decades.

            Reverse Domain Name Hijacking

            To succeed on a claim for Reverse Domain Name Hijacking, Respondent must show that Complainant knew of Respondent’s unassailable right or legitimate interest in the disputed domain name or the clear lack of bad faith registration and use, but nevertheless brought the Complaint in bad faith.  (Sydney Opera House Trust v. Trilynx Pty Ltd WIPO D2000-1274).  The Panel must consider both “malicious intent and recklessness or knowing disregard that Respondent possessed “legitimate interests.” See Gold Line International Inc. v. Gold Line, D2000-1151 (WIPO Jan. 8, 2001).

            If it could be proved that the person (probably Mr. Oates) who contacted Respondent in 1996 or 1997 was acting as an agent for Complainant, or that Complainant had knowledge of that approach, Respondent may be able to succeed on its Reverse Domain Name Hijacking plea.  The Panel can find no firm evidence on this point and is not in a position to make a definitive finding of bad faith against Complainant.  If Complainant knew of Respondent’s activities at the time when its officer made the declaration to the PTO in 1999, then it is hard to see how that declaration correctly reflected the situation.

The unexplained delay of Complainant in filing this proceeding also counts against it.  However, on balance, the Panel declines to make a declaration of Reverse Domain Name Hijacking.

DECISION

Having considered all three elements required under the ICANN Policy, the Panel concludes that relief shall be DENIED.

Hon Sir Ian Barker QC (Presiding Panelist)

Mr. G Gervaise Davis III,  and M Kelly Tillery, Panelists

Dated: December 20, 2004

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